HOW DID THIS MESS HAPPEN?

This 1999 New York Times (!) article serves as clear evidence of lax lending standards towards minorities and low-income people by Fannie Mae.

"Fannie Mae has expanded home ownership for millions of families in the 1990's by reducing down payment requirements,'' said Franklin D. Raines, Fannie Mae's chairman and chief executive officer. ''Yet there remain too many borrowers whose credit is just a notch below what our underwriting has required who have been relegated to paying significantly higher mortgage rates in the so-called subprime market.''

Raines has advised the Obama campaign along with Jim Johnson who is a current economic adviser.

BOTTOM LINE: "Fiscally Conservative. Socially Liberal" yields weird results like this. Also, Liberal Democrats have just as much, if not more, to do with the current economic mess as Republicans.